Streaming had a strong 2021 with royalties to rightsholders, labels and music publishers increasing by 24% to $16.9 billion (IFPI). Spotify drove the segment’s rise as the leading service by users and subscribers (422m and 182m) followed by subscription services Apple Music and Amazon Prime Music, while YouTube is both ad-supported and subscription

Spotify’s 2021 revenue growth of 22% was powered by user growth (+18%) around the world on the subscription (16%) and ad-supported tiers (19%). User growth represented a deceleration from the pandemic-induced exceptional rise of 27% from 2019 to 2020

Spotify reports royalties generated by artists on its Loud and Clear platform. The number of artists in 2021 generating material revenues—over $10,000—increased by 24% to 52,600. 28% are ‘self-distributing artists’ using services such as Distrokid, TuneCore, CD Baby—the number almost trebled since 2017

European mobile revenue growth was zero for the third successive quarter with better mobility but less roaming upside, some B2B weakness, and stronger competitive intensity in the Italian and Spanish markets

Q1 should evidence some similar trends but the impact of out-of-contract notifications will begin to emerge and roaming looks set to become a significant boost from Q2

Consolidation fever continues to dominate the headlines though this is set against a backdrop of considerable uncertainty regarding regulatory approval

TikTok has reached a billion users worldwide just four years after its global launch, much quicker than social media rivals, though its ban in India is a drag on growth.

TikTok’s popularity with under-25s has contributed to a hollowing-out of Meta’s active userbase. During the pandemic, TikTok also expanded its reach among older demographics, cementing its position within the mainstream and posing a further threat to Meta. 

TikTok could earn twice as much revenue as Snap in 2022, making it the first app to break out of the mid-league in years, with a huge runway for growth backed up by ByteDance’s remarkable success in China. 

UK mobile service revenue growth nudged down in Q3 2012 by 2.0ppts to -3.8%, with 0.5ppts driven by an increase in the effect of regulated MTR cuts and 1.5ppts caused by underlying factors, largely driven by a weakening UK economy

In October EE launched its new brand and 4G service to great fanfare. The response of the other operators has been very mixed; Vodafone has indicated that it will launch a better 4G network next year, H3G has emphasised the merits of its 3G network, and O2 has not focused on networks at all. We continue to believe that EE’s 4G products will be good for its ARPU but not necessarily raw subscriber numbers, with the rebrand exercise bringing additional synergy benefits to its bottom line

The overall outlook is looking tough for the next six months, with consumer confidence still low and unlimited tariffs hitting pricing, but more promising thereafter, as the 4G premium becomes more material, and the regulated MTR cuts finally start to moderate in Q2 2013

European mobile market service revenue growth dropped again in Q3, by 1.9ppts to -6.2%. This was not helped by a substantial increase in the MTR impact, driven by a big cut in Italy, but underlying revenue growth still fell by 1.3ppts In stark contrast to Europe, the US mobile market continues to grow apace, with there being over 10ppts between the growth rates of the two regions. The most obvious difference between the markets is the very much higher levels of capex spent by the US incumbents, which drives their superior network quality and coverage, and hence price premia, and hence superior growth The European incumbents have not (yet) used their greater ability to spend on capex to increase the spending gap with smaller operators, with 4G launches (mostly) being low profile with low initial coverage (the UK being a notable exception to this). While this is an understandable approach given the prevailing macroeconomic conditions, it does mean that closing the growth gap with the US remains a distant prospect

EE announced its 4G pricing today, with the prices broadly set at a premium of around £5 a month to those of 3G services from Orange, T-Mobile, O2 and Vodafone

Perhaps more importantly, the pricing includes unlimited voice and text as standard, which pushes the minimum spend to £36 a month, a substantial uplift from current average contract values of £20-£25

Whether the £5 premium is sustainable or not, EE’s efforts to promote it (and competitor responses) will likely shift the market focus to network quality as opposed to price and handset range, a very healthy development in our view

A number of developments over the summer have, at least in theory, made the UK 4G mobile spectrum outlook a lot clearer: in July Ofcom issued its final policy statement regarding the 800MHz and 2.6GHz ‘4G’ auctions, in August it decided to allow Everything Everywhere (EE) to ‘refarm’ its 1800MHz spectrum for 4G use, and EE announced that it had sold 15MHz of its 1800MHz spectrum to H3G

The main short term implication is that EE will have clear short term advantage of being the only operator offering 4G (LTE) services for about 12 months from (roughly) the end of September 2012 to (roughly) the end of September 2013

The main uncertainty is legal action; O2 and/or Vodafone may appeal Ofcom’s decision to allow EE to refarm its 1800MHz spectrum, which would trigger EE to appeal the 4G spectrum auction rules, and give 4G in the UK an unhelpful delay

In this presentation we show our analysis of the UK mobile market performance to Q2 2012 and consider the outlook both in terms of market growth and competitive dynamics

In this presentation we show our analysis of revenue growth trends for mobile operators in the top five European markets (UK, Germany, France, Italy and Spain). The historical analysis is based on the published results of the operators, although they include our estimates where their data is inconsistent or not complete. A copy of the underlying data in spreadsheet format is available to our subscription clients on request.

France’s Orange Sport closed last month after France Télécom declined to bid for a renewal of its four-year licence to broadcast Ligue 1 football. The future of its sister film channel, Orange Cinéma Séries, remains unclear.

The strategic aim for Orange Sport was confused from the start – standalone profit centre or loss leader, fully fledged alternative to Canal+ or add-on to it.

Orange’s premium TV project was a failure: we estimate its cumulative losses at €1.2 billion, while Orange’s broadband market share and retail price premium shrank during the four years of its operation. But it did arguably strengthen Orange’s hand in carriage negotiations with Canal+.